Head of Investor Relations

ni.com

Head of Investor Relations

Marissa Vidaurri

ni.com

Safe Harbor WarningForward-looking StatementsDuring today’s presentation, we expect to make forward-looking statements regarding the future financial performance of NI or future events, including our strategic goalsand direction; objectives; targets; plans; focus; priorities; models; revenue targets, goals, expectations, and outlook; revenue mix targets, goals and expectations; non-GAAPgross margin targets, goals and expectations; non-GAAP operating income and non-GAAP operating income as a percentage of revenue (non-GAAP operating margin)targets, goals and expectations; cash flow targets, goals and expectations; operating models; vision; future growth and profitability; our market, served available market, andcategory position, strategy, trends, expectations, impact, and growth opportunities, including regarding share (including in the semiconductor, transportation, aerospace,defense and government industries and other industries we serve (portfolio)); growth opportunities, drivers, inflections, and trends; capital allocation priorities and plans;dividend policy and plans; acquisition strategy and plans; stock repurchase strategy and plans; expense and spending management, control strategy, targets, and plans(including non-GAAP spending in, and within, R&D, SG&A, and other functions); expectations regarding the COVID pandemic situation; plans regarding restructuring;technology accelerators; value proposition; shareholder returns; technology and industry trends; and our outlook. We wish to caution you that such statements are justpredictions and are subject to a number of risks and uncertainties, and that actual events or results may differ materially and could be negatively impacted by the risks anduncertainties, including risks and uncertainties related to the COVID-19 virus and further economic and market disruptions resulting from COVID-19; further adverse changesor fluctuations in the global economy; further adverse fluctuations in our industry; foreign exchange fluctuations; changes in the current global trade regulatory environment;fluctuations in customer demands and markets; fluctuations in demand for NI products including orders from NI’s large customers; component shortages; delays in therelease of new products; NI’s ability to effectively manage its operating expenses; manufacturing inefficiencies and the level of capacity utilization; the impact of any recent orfuture acquisitions or divestitures by NI (including the ability to successfully operate or integrate the acquired company’s business into NI, the ability to retain and integratethe acquired company’s employees into NI, and the ability to realize the expected benefits of the acquisition); expense overruns; and adverse effects of price changes oreffective tax rates. Actual results may differ materially from the expected results. We refer you to our Form 10-K for the year ended Dec. 31, 2019, our Form 10-Q for thequarter ended March 31, 2020, and the other documents we file with the SEC for other risks associated with NI’s future performance. These documents contain and identifyimportant factors that could cause our actual results to differ materially from those contained in our forward-looking statements. All information in this presentation is as ofAugust 4, 2020. NI undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in NI’s expectations.Non-GAAP InformationIn today’s presentation, we have included certain non-GAAP financial results with respect to some or all of the following items: revenue, gross margin, research anddevelopment and other operating expenses, operating margin, operating income, net margin, net income, and diluted EPS. Our non-GAAP results exclude, as applicable, theimpact of stock-based compensation, amortization of acquisition-related intangibles, acquisition-related transaction costs, taxes levied on the transfer of acquired intellectualproperty, foreign exchange loss on acquisitions, restructuring charges, tax reform charges, disposal gain on buildings and related charitable contributions, tax effects relatedto businesses held for sale, gain on divestment, and capitalization and amortization of internally developed software costs. We have included reconciliations of our non-GAAP results to our GAAP results on our website at ni.com/nati at the Non-GAAP Reconciliations link. For periods prior to March 31, 2005, our non-GAAP results are thesame as our GAAP results.

ni.com

CEO

Eric Starkloff

Eric StarkloffPRESIDENT & CEO

Deborah GreenPRINCIPAL EXECUTIVE ASSISTANT, CORPORATE

Luke SchreierVICE PRESIDENT

AND GENERAL MANAGERAERO, DEF, & GOVT

Carla Piñeyro-SublettGENERAL MANAGER, PORTFOLIO

AND CMO

Eddie Dixon

VICE PRESIDENT AND GENERAL COUNSEL

LEGAL

Ritu FavreSENIOR VICE PRESIDENTAND GENERAL MANAGER

SEMICONDUCTOR

Kevin Ilcisin

VICE PRESIDENTCORPORATE STRATEGY

EXECUTIVE LEADERSHIP TEAM

Chad ChesneyVICE PRESIDENT

AND GENERAL MANAGERTRANSPORTATION

Cate Prescott

VICE PRESIDENTHUMAN RESOURCES

Stefanie Breyer

VICE PRESIDENTPRODUCT PLANNING

Scott Rust

SENIOR VICE PRESIDENTPRODUCT R&D

Karen Rapp

EXECUTIVE VICE PRESIDENT AND CFO

Jason Green

SENIOR VICE PRESIDENTGLOBAL SALES, SUPPORT,SERVICES AND OPERATIONS

ni.com

Long-Term Commitment for All Our Stakeholders

ni.com

Diverse Business with Strong Results

COUNTRIES WITH NI OPERATIONS

50+

REVENUE

$1.35BINVESTMENT IN R&D

20%NON-GAAP OPERATING MARGIN

19%2019 RESULTS

AMERICAS

40%EMEA

28%APAC

32% CUSTOMERS WORLDWIDE

35,000+2019 REVENUE BY REGION

A reconciliation of non-GAAP operating margin to GAAP operating margin is available at ni.com/nati.

ni.com

2023 Business Targets

30%REVENUE FROM SOFTWARE

>70%REVENUE FROM ORDERS >$20K

Our Strategy for Growth

Enhance our software offering to meet enterprise-level needs of our customers

Meeting our customer needs through more system-level capabilities

Investing to create differentiated services

Make it easier to do business with NI by streamlining our buying process

Long-term Ambitions

ni.com

ProductionResearch Deployment and Maintenance

APPLICATION AND DEVELOPMENT SOFTWARELabVIEW TestStand VeriStand C#/.NET Python FlexLogger™ DIAdem ...

MODULAR HARDWAREPXI CompactDAQ VST CompactRIO USRP ...

PRODUCT ANALYTICS AND TEST OPERATIONSOptimalPlus SystemLink™

SERVICESSoftware Services Hardware Services Consulting + Integration Services Education Services NI Partners

Design and Validation

NI SOFTWARE-CONNECTED SOLUTIONSENABLING INNOVATION AND PRODUCTIVITY ACROSS THE PRODUCT DEVELOPMENT CYCLE

ni.com

ProductionResearch Deployment and Maintenance

APPLICATION AND DEVELOPMENT SOFTWARELabVIEW TestStand VeriStand C#/.NET Python FlexLogger™ DIAdem ...

MODULAR HARDWAREPXI CompactDAQ VST CompactRIO USRP ...


SERVICESSoftware Services Hardware Services Consulting + Integration Services Education Services NI Partners

Design and Validation


TAILORED, APPLICATION-SPECIFIC SYSTEMSSemiconductor Test System Electric Vehicle Battery Test System Condition Monitoring ...

ni.com

Software-Connected Test Systems



Test data enables unique product insights that drive business value

Data analytics enables automation and optimization of test systems

ni.com

$3.6BPortfolio

NINI

$1.2BSemiconductor

IN

NI | ~$17B TAM, ~$8B SAM

$1.7BTransportation

NI

$1.3BAerospace,

Defense, and Government

NI Well Positioned for SAM Expansion

$8B2023 SAM

3-5%SAM EXPANSION2020-2023

~20%NI MARKET SHARE

2023

ni.com

Revenue

Gross Margin

R&D Spendas % of Revenue

SG&A Spendas % of Revenue

Operating Margin

2016 2020 Model 2023 Model

$1.23B $1.3B 9% CAGR

77% 75% 75%

21% 20% 19-20%

44% 40% 35-36%

12% 15% 20%

A reconciliation of historical non-GAAP financial measures on this slide to the most directly comparable GAAP financial measure is available at ni.com/nati.

Non-GAAP Target Financial Model

ni.com

NI CONFIDENTIAL

NI Value Proposition

Aligned Leadership Team Focused on Strategic Execution to Deliver Results in Pursuit of our Long-Term Growth Ambitions

Differentiated Software-connected Systems Combined with Investment in Data Analytics Enhances Value of Test to Our Customers and Expands SAM

Creating Deeper Customer Connections while Driving Efficiency through Scale and Leverage

Strong Cash Flow Generation Provides Flexibility to Fuel Organic Innovation and Fund Future Opportunities for Inorganic Strategic Acceleration

ni.com

Senior Vice President & General Manager, Semiconductor

Ritu Favre

ni.com

Strategy to grow current SAM through new offerings and 5G opportunity

Semiconductor | ~$1.2B SAM Accelerating Growth Through Key Market Inflections

5G

HMI

Digital Transformation

Mixed Signal / DigitalRFIC

Opto

NI NINI

60% 40%

Production Test

Validation Test

Revenue Mix

Represents 2023 estimate

ni.com

Semiconductor | Macro Trends to NI Strategy

IoT

Personal Health

Wireless Communications (5G)

AR/VR

AI

HMI

AutonomousDriving/EV

RFICs

Optoelectronics

Analog, MEMS, Wafer Level Reliability

Macro Trends Semiconductors

• New Bands & Specs• New Standards• New Measurement

Types

• New Electrical and Optical Measurement Needs

• Market Maturation• Cost Pressure

Inflections NI Strategy

Focused play with solutions for emerging RFFE

test requirements

Focused playwith solutions for new

sensors/displays

Pursue for cost of test play

ni.com

5G Market Update• Strong H1 NI Semi performance due to customer investment in 5G RFIC validation and scale of production design wins• Short-term COVID-19 slowdown driving lower than expected 5G deployments in 2020, accelerating in 2021• Carrier subsidies of 5G mmWave handsets signal future mmWave adoption

Carriers• Aggressively deploying sub-6 GHz 5G infrastructure• Signaling future mmWave deployments with subsidy

of 5G mmWave handsets

Standards Bodies• 3-6 Month delay in future 3GPP releases

(Release 16 and 17) delays mmWave feature readiness

Chipmakers• Significant COVID-19 impact• Weaker H2 outlook, with -10% YOY mobile decline• Slight delay in mmWave, more focus on sub-6 GHz

short term

Government & Regulatory• Increasing US-China trade tensions driving de-

Americanization of Huawei supply chain• FCC aggressively driving access to sub-6 GHz spectrum,

delaying mmWave

ni.com

SemiconductorGrowth Opportunity

$1.2BNI SAM(2023)

10-15%REVENUE CAGR GOAL

2020-2023

5%MARKET GROWTH2020-2023

18%REVENUE CAGR2016-2019

> $20k

< $20k

Orders 2019

SOURCES: IC INSIGHTS AND NI ESTIMATES

ni.com

ni.comACCELERATING GROWTH THROUGH KEY MARKET INFLECTIONS

Semiconductor Growth Drivers NI Value Proposition

RFICs – About half of NI semiconductor SAM is in 5G. 5G adoption accelerates opportunity to take share

Mixed Signal – Opportunities for SAM expansion in validation test through D2T, wafer-test, and modern lab initiatives

Optoelectronics – Addressing new technical requirements from mini/micro LEDs, VCSELs and optical sensors.

Production – Reduce cost of test with solutions that increase test throughput and expand test coverage

Validation – Accelerate time-to-market with solutions that automate device characterizationand validation

Enterprise Software – Accelerate digital transformation initiatives and optimize product performance throughout the product lifecycle with advanced product analytics

ni.com

Vice President &General Manager, Transportation

Chad Chesney

ni.com

Powertrain

NI

Body & Chassis

NI

Active Safety

NI

Connectivity

NI

System Integration

NI

Growth driven by trends in electrification, ADAS, autonomy, and connectivity

Transportation | ~$1.7B SAM Accelerating Growth Through Key MarketInflections

Electrification

Autonomy

Connectivity


40%60%

Production Test

Validation TestRepresents 2023 estimate

ni.com

TransportationGrowth Opportunity

SOURCES: STRATEGY ANALYTICS AND NI ESTIMATES

> $20k< $20k

$1.7BNI SAM(2023)


2020-2023



Orders 2019

ni.com

ni.com

Transportation

Electrification ADAS & Autonomy

ECU Complexity Connectivity

CONTINUED INVESTMENT IN NEW AUTOMOTIVE TECHNOLOGY DRIVES DEMAND FOR NEW SCALABLE TEST APPROACHES

Growth Drivers NI Value Proposition

Software-connected test systems are easily adapted with rapid requirement changes to accelerate innovation and time to marketModular hardware and measurement breadth is configurable for testing complex components and expandable to meet future test requirementsExpert systems delivery capabilities with NI Services and the NI Partner Ecosystem reduces test development timeProduct analytics and test operations software connects data across the product development cycle to quickly identify failure root-cause and reduce the cost of quality

ni.com

Vice President & General Manager, ADG

Luke Schreier

ni.com

Share gains through growth in system-level offerings, services, and enterprise software

Aero, Def & Govt | ~$1.3B SAM Accelerating GrowthThrough Key Market Inflections

Cognitive and Autonomous Systems

Sensor Fusion and Convergence

More Electric Aircraft


NI

Ground- based Comms.

and Sensors

Defense Aircraft

NI

Rockets, Missiles, and Launch Vehicles

NI

Satellites

NI

Additional Commercial and Defense Platforms (e.g. Airliners, General Aviation, Surface Vessels,

Undersea Vessels, Ground Vehicles)

22%36%

Production and Post-Production Test

Validation Test

NI

Research and Prototyping

42%


ni.com

> $20k< $20k

Aero/Def/GovtGrowth Opportunity

Order Mix

SOURCES: DELOITTE, IHSMARKIT, US DOD AND WW DEFENSE BUDGETS, and NI ESTIMATES

$1.3BNI SAM(2023)


2020-2023



Orders 2019

ni.com

ni.com

Aerospace, Defense & Government ACCELERATING THE INCORPORATION OF ADVANCED CAPABILITY ENABLERS (ACES)

Growth Drivers NI Value PropositionMarket/Business • Strong global defense spending• Commercialization and interest in space• Digital transformation and modernization

Technology• Incorporation of Advanced Capability

Enablers (ACEs) like autonomy, artificial intelligence, hypersonics, cognitive radar, sensor fusion, and electric aircraft

• Increased need and reliance on software, validated across thousands of scenarios

Our customer’s success relies on incorporating ACEs while maintaining existing assets. This requires rapid technical innovation andmultidomain subsystem integration.NI’s broad electrical/physical measurement expertise, differentiated electromagnetic/RF test capability, and enterprise software toolchain accelerates ACEs through system-level test across domains.Our prototyping and automated test capabilities help shorten development cycles, improve mission readiness, and maximize effectiveness of our customer’s engineering talent.

ni.com

General Manager, Portfolio,& Chief Marketing Officer

Carla Piñeyro Sublett

ni.com

Strategy to grow share through leverage of megatrends and making it easier to buy from NI

Portfolio | ~3.6B SAM Accelerating GrowthThrough Key MarketInflections

Convergence of Devices

5G


NINI

Electrical Machinery

and Equipment

NI

Other Industries

Electronics

Academic

NI

NINI

Life Science

Energy

20%40%

40%


Production and Post-Production Test

Validation Test

Research and Prototyping

ni.com

PortfolioGrowth Opportunity

$3.6BNI SAM(2023)


2020-2023


-2%REVENUE CAGR2016-2019

> $20k < $20k

Orders 2019

SOURCES: F&S, Prime Data, ABI Research, VDC and NI Estimates

ni.com

ni.comLEVERAGE OUR INNOVATIVE PLATFORM ACROSS A BROAD CUSTOMER BASE

Portfolio | StrategyScale Leverage

Streamline the Buying Process Product Lens

• Increase customer intimacy through clear business value

• Leverage inside sales, e-commerce and indirect channel to drive scale and efficiency for broad set of customers

• Expand customer reach through robust demand-generation plan

• Optimized investment through more modern approach

• Gain leverage and scale across the business through simplification and modernization

• Deliver application-specific offerings that leverage standard platform capabilities

• Transition from mass customization to create standard plug and play

• Efficiently adapt software and data analytics capabilities to increase recurring revenue

ni.com

Senior Vice PresidentGlobal Sales, Support, Services and Operations

Jason Green

ni.com

Transformation Creating Momentum

SALES

40%

40%

20%Tier 3 Accounts ~30,000 Accounts

Tier 2 Accounts ~5,000 Accounts

Tier 1 Accounts ~100 Accounts

Geography-Based Model with DistributionServe Customer Requests and Prioritize Digital

Account-Based ModelGenerate Demand in Target Customer Segments

Account-Based ModelBuild Partnerships with High-Potential Accounts

Percentages represent 2020 targeted revenue model

96%GLOBAL

RETENTION RATE

Our People Are Engaged

ni.com

Opening New Opportunities with Systems and Software

26%

Clarke RyanSENIOR DIRECTOR PRODUCTS GROUP

SPIRENT COMMUNICATIONS

PIPELINE GROWTH IN TIER 1

21%INCREASE IN AVG OPPORTUNITY SIZE

15%GROWTH IN SOFTWARE

ENTERPRISE AGREEMENTS

I don't feel like I'm working with a vendor, I've got a partner by my side.

8%SYSTEM-LEVEL

BUSINESS GROWTHOVER TRANSACTIONAL

Data from last 2 years

ni.com

CEO, SET GMBHNI partner for over 16 years

Monetizing New Services Capabilities to Accelerate Growth

Frank Heidemann

NI’s new partner strategy on alignment and collaboration to deliver software-connected systems will drive enterprise-level opportunities and growth we've not experienced in the past.

Partner Program Renewed Focus and Investment

NI Global ServicesExpanding Capabilities and Differentiation

11%*HARDWARE SERVICES

GROWTH OVER HARDWARE SALES

50,000NEW USERS IN

TRAINING PLATFORM IN 2020

40%*INCREASE IN INTEGRATION SERVICES HOURS DELIVERED

*Increase from 2017 to 2019

ni.com

Streamlining Business to Optimize and Scale

ni.com

2023 Business Targets

Enabling Long-Term Growth Opportunities with ExpertiseCreating Momentum through Transformation

Opening New Opportunities with Systems and Software

Monetizing New Services Capabilities to Accelerate Growth

Streamlining Business to Optimize and Scale

GLOBAL SALES, SUPPORT, SERVICES & OPERATIONS

ni.com

Senior Vice PresidentGlobal Product Research & Development

Scott Rust

ni.com

Leveraging our R&D Investment Across the Business

Industry Specific

Platform Semiconductor Transportation ADG Portfolio

NI Platform

20%

80%

ni.com

Leveraging our R&D Investment Across the Business

Industry Specific

Platform Semiconductor Transportation ADG Portfolio

NI Platform

20%

80%

ni.com

• Wireless connecting everyone and everything

• Cloud driving massive scale data streaming, computation, and storage

• Data and analytics empowering better business decisions

• Pervasive sensing of the physical world

• Evolution of autonomous systems powered by machine learning/AI

Technology Mega-trends to Leverage

Connecting with Our Customers to Get Ahead of Their Technology Needs

ni.com

• Data Analytics• Systems & Data Management • Design Tool Connectivity

Highly Leveraged R&D Investments

Enterprise Software

• Software Platform Framework• Test Development and Test Management• Linux, Python, and MathWorks Support• Enhanced Security Features

Application Software

• Instrumentation Hardware• Interfacing Hardware• System and Tester Infrastructure

Systems Hardware and Software

• Increasing Frequency and Bandwidth• Measurement IP and DSP • Over-the-Air (OTA) Capability

Wireless Test

ni.com

CFO

Karen Rapp

ni.com

Long-term Track Record of GrowthR

even

ue In

Milli

ons

$200

$400

$600

$800

$1,000

$1,200

$1,400

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020Model

ni.com

Focused to Accelerate Revenue Growth

Semiconductor

Transportation

Aerospace & Defense and Government

Portfolio (All Other Industries)

10–15%

10–12%

6–9%

5–6%

2016-20193-Year CAGR

18%

9%

7%

-2%

2020-2023 3-Year CAGR Goal

15%

14%

24%

47%

2019 Billings by Industry

Semi

Transportation

ADG

Portfolio

NI 2020-2023 3-Year CAGR Goal 9%

CAGR = Compound Annual Growth Rate

ni.com

High Non-GAAP Gross Margins, averaging 76% over last 25 years

A reconciliation of historical non-GAAP gross margin to GAAP gross margin is available at ni.com/nati.

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020Model

0%

20%

40%

60%

80%

100%

76% 75% 77% 76% 77% 76% 74% 73% 74% 73% 76% 76% 77% 77% 77% 79% 79% 78% 76% 77% 77% 77% 77% 78% 78% 75%

Consistently Providing Value Through Innovation

ni.com

Operating Model Target Range 15-20%

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020Model

0%

5%

10%

15%

20%

$0M

$50M

$100M

$150M

$200M

$250M

$300M

A reconciliation of historical non-GAAP operating income and operating margin to GAAP operating income and operating margin is available at ni.com/nati.

Non-GAAP Operating IncomeNon-GAAP Operating Income as Percent of Revenue

Executing to Our Non-GAAP Operating Margin Target

Driving scale in operations through standardization, simplification, automation

ni.com

Delivering Strong Cash Flow From Operations

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020Model

$0

$50M

$100M

$150M

$200M

$250M

$300M

0%

5%

10%

15%

20%

25%

Cash flow from operationsCash flow from operations as Percent of Revenue

Cash Flow From Operations, average of 15% of revenue

ni.com

Disciplined and Balanced Capital Allocation Priorities

$2.4B

$935M

$318M

$614M*

Objective of Long-Term, Sustainable Value for Investors

Deployed Capital $4.3B | 2010–1H2020Purpose

R&D Investment

Dividends

Share Repurchase

Acquisitions

Organic Growth

Return Capital to Investors

Return Capital to Investors

Accelerate Strategy *Includes Optimal+ Transaction closed July 2, 2020

ni.com

Strategic Acceleration Through M&AEvaluation Consideration

Focus Key Criteria

Corporate• Alignment to Core Strategic Vision • Technology to broaden or improve differentiation for leverage

across the portfolio

Industry • Strategic acceleration to industry growth targets• Expands SAM via IP or expertise

Operational• Sales channel fit• Company culture alignment, talent retention• Manufacturing and supply chain leverage

Financial• Leverage of cash and strong balance sheet• Accretive to EPS with synergies• ROIC above WACC in 3-5 years

ni.com

Revenue

Gross Margin

R&D Spendas % of Revenue

SG&A Spendas % of Revenue

Operating Margin

2016 2020 Model 2023 Model

$1.23B $1.3B 9% CAGR

77% 75% 75%

21% 20% 19-20%

44% 40% 35-36%

12% 15% 20%

.A reconciliation of historical non-GAAP financial measures on this slide to the most directly comparable GAAP financial measure is available at ni.com/nati.

Non-GAAP Target Financial Model

ni.com

NI Value Proposition

Aligned Leadership Team Focused on Strategic Execution to Deliver Results in Pursuit of our Long-Term Growth Ambitions

Differentiated Software-connected Systems Combined with Investment in Data Analytics Enhances Value of Test to Our Customers and Expands SAM

Creating Deeper Customer Connections while Driving Efficiency through Scale and Leverage

Strong Cash Flow Generation Provides Flexibility to Fuel Organic Innovation and Fund Future Opportunities for Inorganic Strategic Acceleration

ni.com

Vice PresidentGlobal Human Resources

Cate Prescott

ni.com

Be Kind

Be Bold

Be Connectors

NI VALUES

ni.com

Exposure to STEM concepts

Ability for hands-on STEM projects

Link STEM opportunity to in-school learning

Exploration

Engagement

Immersion

Commitment to provide technology access to the under-served for pipeline of future engineers

STEM Program Investment

ni.com

CEO

Eric Starkloff

ni.com

Position of Strategic and Financial Strength

Consistent Long-Term Shareholder Returns

Building a Strong and Stable Business for the Next 100 Years

Disrupting the Market through Software Differentiation

Leadership Aligned to Long-term Growth

Head of Investor Relations

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